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What's Next for EV?

May 26, 2021
Here’s what some of the biggest manufacturers in the EV market have to say about how the EV portion of President Biden’s infrastructure plan will impact the electrical industry.

Editor's note: While it’s impossible to say what Democrats and Republicans may eventually agree on in terms of any infrastructure bill, many of the initial ideas in the Biden Administration’s proposal would increase demand for electrical construction materials. Electrical Wholesaling’s editors believe the following proposals could have the most impact on the electrical market:

  • $213 billion to build, preserve and retrofit more than 2 million homes and commercial buildings to address the affordable housing crisis
  • $174 billion in spending on a national electric vehicle charging network and rebates and incentives for EV manufacturing and vehicle purchase by consumers
  • $100 billion for high-speed internet access in underserved urban and rural areas
  • $100 billion to re-energize America’s power infrastructure
  • $100 billion to modernize schools and early learning centers
  • $80 billion proposed for freight rail and passenger trains would have an impact on the electrical market
  • Billions of dollars in additional spending on federal buildings and VA hospitals, airports and ports

Electrical Wholesaling magazine and Electrical Marketing newsletter will be covering the progress of the infrastructure negotiations over the next few months, and we will be kicking off that coverage in this article with the impact of the proposal’s plan for federal spending on electric-vehicle charging equipment and financial incentives for the purchases of electric vehicles. We will be reporting on the progress of the other proposals mentioned above in the coming months. — Jim Lucy

As part The American Jobs Plan, President Biden is proposing a $174-billion investment toward electrifying vehicles and helping the U.S. become a global leader in the electric vehicle (EV) market. According to the White House Briefing Room’s Fact Sheet released on March 31, 2021, the plan will:

  • Enable automakers to spur domestic supply chains from raw materials to parts, retool factories to compete globally and support American workers to make batteries and EVs.
  • Give consumers point of sale rebates and tax incentives to purchase American-made EVs.
  • Help ensure that vehicles are affordable and manufactured by workers with good jobs.
  • Establish grant and incentive programs for state and local governments and the private sector to build a national network of 500,000 EV chargers by 2030, while promoting strong labor, training and installation standards.
  • Replace 50,000 diesel transit vehicles.
  • Electrify at least 20% of the yellow school bus fleet through the Clean Buses for Kids Program at the Environmental Protection Agency with support from the Department of Energy.
  • Utilize tools of federal procurement to electrify the federal fleet, including the U.S. Postal Service.

The editors at Electrical Wholesaling spoke with leaders from three manufacturers with strong EV portfolios and history of success in the EV market – Leviton, ABB and Eaton – to seek a better understanding of how the EV portion of this infrastructure plan will impact the electrical industry and, in particular, electrical manufacturers. While the plan’s passing would ensure massive business opportunities, a steady increase in jobs along the EV supply chain and further research and development in the EV sector, there are a lot of moving parts that manufacturers and others in the electrical industry will need to keep in mind.

The plan will help push what is already happening. Electrification of vehicles is nothing new, and if this plan comes to fruition, it will help further the progress already being made in terms of EV technology and infrastructure. “The march to electric transportation is unstoppable,” says Asaf Nagler, senior director for government relations at ABB, which has over a decade of experience in designing, developing and manufacturing EV charging technology. “The American Jobs Plan will put the U.S. in a position to lead the transportation economy into the future,” he adds.

Similarly, Paul Connors, director of marketing for Eaton’s electrical engineering services and systems business believes Biden’s plan is essential to help speed up what he calls a “paradigm shift of transportation electrification.”

Manufacturers will have a big role to play. On the most superficial level, manufacturers will provide essential parts and technology, such as EV chargers and other parts needed to electrify the vehicles themselves. Maria Acosta is the senior director of product management for Leviton’s Commercial & Industrial (C&I) business unit focusing on industrial and electrical vehicle supply equipment (EVSE) categories. She believes that manufacturers with a deep knowledge of the industry will also be key in helping educate consumers. “This includes detailing opportunities for distributors and installers along with the relevant tax credits and rebate information, as well as educating end-users on EVSE,” she says, adding that while the industry is growing, it is still a foreign concept to many.

Connors says manufacturers that are experts in power management such as Eaton will play a critical role in providing the solutions for EV charging infrastructure. With part of Biden’s plan calling for a massive deployment in the number of chargers – 500,000 across the nation by 2030 – it will require significant upgrades to the power distribution systems, Connors adds, so grid stability and energy storage are vital as the nation expands its electrical vehicle charging infrastructure. Further, more renewable energy resources like wind and solar, and other distributed energy resources, need to come online and will require intelligent controls to enable efficient energy use and reliable and sustainable electricity supply.

Similarly, ABB’s Nagler reminds that while this plan will spark demand for EV-related technology and services, it certainly doesn’t end there in terms of the role electrical manufacturers play. “As EVs scale up, new digital and control technologies will be needed for energy management and demand-response,” he says. “Upgrades on the distribution grid will be needed to support new EV-related electrical load. And new electricity demand created by EVs will lead to increased deployments of clean generation, like wind and solar, and flexible grid technologies, like energy storage.”

Some other challenges can be expected. With all the benefits that the plan will have for the overall U.S. economy and many in the electrical industry, the experts we spoke to said there would be some challenges to overcome. “The government may struggle with acquiring a balanced and trained labor force, materials availability, educational requirements and more,” Leviton’s Acosta points out. “For residential consumers, upfront costs of EVs and installation of chargers could be a challenge and when addressing chargers requiring Wi-Fi or cellular connectivity, there may be a challenge in signal capacity.”

Helping consumers overcome any misconceptions or aiding in the decision to embrace EV technologies is something else manufacturers can assist with. Connors says Eaton is playing a critical role helping customers understand the benefits and opportunities to advance electric vehicle adoption. For example, he says Eaton is helping fleet owners make intelligent decisions on electrifying their fleet. One of the main considerations is the total cost of ownership in terms of both power distribution and energy consumption, beyond the cost of the vehicle itself.

Additionally, Nagler says that ABB has a long history of engaging with global EV standards organizations and promoting collaborative work within the industry, but the need to collaborate – which requires major organization – can provide some challenges. He believes that open standards and policies that support EV use will foster innovation and interoperability, along with a safe and reliable supply chain.

What can manufacturers do to prepare? Nagler says one of the biggest things that manufacturers can do to be ready for the influx of EV that will come of this plan will be to embrace collaboration within the EV infrastructure industry, which includes vehicle makers, charging networks and infrastructure technologists from site planners to well-trained installers who are working with reliable equipment. “Long-term success requires fully-funded operational and maintenance models that actively monitor and service chargers from cradle to grave,” Nagler says. “The ‘install and forget’ model has never been a winning strategy.”

Manufacturers will benefit from knowing what incentives are available and what the EV requirements are in their area, says Acosta. “While this is a federal bill, there are incentives that will vary state by state, as well,” she adds.

Opinions are overwhelmingly positive. Despite any potential challenges that the plan may present, each of the leaders we spoke with reiterated the historic, economic, societal and environmental importance of Biden’s proposed plan in terms of its EV goals. Acosta says Leviton is excited for the proposal for several reasons, but in terms of the EV incentives, she is confident it will help close the gap in terms of the ratio of EVs to fossil fuel cars and commercial vehicles but believes a thorough and detailed plan by the government will be necessary to ensure all aspects are addressed and plans are in place prior to any implementation.

For Connors, he believes there is transformational change happening for our energy infrastructure. “The market is coming to us,” he says. “So, it’s a very, very exciting time to be in the industry, as a manufacturer and for our distributor partners.”

SIDEBAR: What role will distributors play?

While the manufacturers we spoke with are confident that this plan will keep them busy in terms of its EV goals, respondents to this year’s EW Top 200 survey suggest otherwise when it comes to electrical distributors. Only 25% of respondents believe there will a major sales impact because of the EV charging station portion of Biden’s plan, while a whopping 57% say there will be minimal impact and 18% of respondents say there will be no impact (Figure). Compared to other parts of the plan, EV charging stations seem to present the least amount of potential impact on sales. However, Leviton’s Acosta says that part of the company’s goals will include detailing EV opportunities for relevant tax credits and rebate information for many, including its distributor partners, as we move toward a future of vehicle electrification.